MIDAS SHARE TIPS: If you want healthy profits consider the firm seeking cures using NHS records
The NHS is often referred to as a national treasure. But the entire system is under intense pressure, as the population ages, obesity increases and drugs become more expensive.
Prime Minister Theresa May is determined to make it work better. Speaking at last week’s Conservative Party conference, she pledged to speed up cancer diagnosis.
Earlier this year, she spoke about using artificial intelligence to fight cancer and a range of other chronic diseases.
Sensyne Health is helping the NHS to put the Prime Minister’s words into practice. The shares are 187p and should rise substantially over the next few years.
Sensyne Health is a pioneer in clinical artificial intelligence, using data from the NHS
The company is a pioneer in clinical artificial intelligence (AI), using anonymised data from the NHS to diagnose patterns in cancer, heart disease and lung disease, as well as conditions such as Alzheimer’s and diabetes.
The company then passes on its findings to drug companies so they can develop treatments faster and more cost-effectively than in the past.
Importantly, the drug firms do not have access to the data itself so Sensyne acts as a gateway between the NHS and the pharmaceutical industry.
The model was developed by chief executive Lord (Paul) Drayson, a highly successful entrepreneur who co-founded medical diagnostic firm Powderject Pharmaceuticals in 1993 and sold it for £550 million ten years later.
Drayson recognised that the UK has two major advantages in the fast-moving world of clinical AI. First, the NHS has enormous amounts of patient data, probably more than any other health service in the world. Second, Britain is at the forefront of research into how best to use AI.
Drayson has a PhD in robotics and a lifelong passion for science, technology and fast cars.
Minister for Science and Innovation in Gordon Brown’s Labour Government, he founded Sensyne just a year ago, working in partnership with Oxford University and the Oxford University NHS Trust.
In return for providing data to Sensyne, the NHS gets a share of the drug company payments
The company has since signed agreements with two more Trusts, South Warwickshire and Chelsea & Westminster in London and expects to add three more within the next two years.
Under these agreements, the NHS Trusts provide anonymised data to Sensyne, which it sieves through looking for clues about how diseases arise and develop.
Smart ideas are patented and licensed to drug firms, who provide upfront payments, milestone payments and royalties to Sensyne.
In return for providing the initial data, the Trusts receive shares in Sensyne and a share of the drug company payments.
In this way, the NHS helps to improve treatments for patients and receives tangible financial benefits, which can be used, in turn, to deliver better care.
Sensyne is a relatively new company but it has already made some major breakthroughs. The group has developed apps used on tablets and smartphones to monitor heart conditions, lung disease and diabetes among pregnant women.
One app, SEND, analyses patients at risk of cardiac arrest while they are in hospital, sending the data to doctors and nurses so high-risk patients can be seen first.
The app has already cut heart attacks on the ward by 20 per cent. Another app, used at home by lung disease sufferers, has reduced hospital admissions by 17 per cent.
Sensyne does not generate revenues from these apps but it uses the data to further its research. In time however, Drayson hopes to make money from these apps overseas and is already in talks with US hospitals.
Sensyne has also signed a licence agreement with a drug company relating to its lung disease findings and expects to sign another major deal in the short term.
Sales are expected to surge from £100,000 this year to more than £12 million by 2021. The group is likely to be loss-making for the next few years, ploughing revenues back into the business but the long-term outlook is bright.
Encouragingly too, Drayson and his wife own 29 per cent of the stock and the board is filled with professors, scientists and high-ranking doctors, led by chairman Professor Sir John Bell, Regius Professor of Medicine at Oxford.
MIDAS VERDICT: Sensyne Health is a rare beast. Using cutting-edge technology, the company is working with the NHS to help drug companies find cures for some of the most prevalent diseases of our time. At 187p, the shares are a buy.